Category: Broker-Dealer

In order to start a broker-dealer, you must submit a new membership application (NMA) to the Financial Industry Regulatory Authority (FINRA). Completing the NMA is often an arduous process. To assist clients, we have a team of experts that can simplify the process, answer any questions, and get you to the finish line. Read More…

Are you looking to start a broker-dealer or buy a broker-dealer? If so, we can assist you in weighing the two options. Securities Compliance Management, Inc., also doing business as MasterCompliance, is a full-service compliance consulting firm. We have assisted many clients in starting and buying a broker-dealer. There are many factors that you should consider before deciding which option is the best for you. Read More…

FINRA Rule 2210 requires that firms retain records of communications that relate to their “business as such” under Rule 17a-4(b) of the Securities Exchange Act of 1934 (SEA). Therefore, it is the content of the broker’s communication that determines whether it is regulated under Rule 2210. However, how does the rule apply if the firm[…]

As you may recall, the Fiduciary Rule’s BIC Exemption and Principal Transaction Exemption became applicable on June 9, 2017, with transition relief through January 1, 2018. However, recently the Department of Labor announced the delay of the second implementation of the Fiduciary Rule, amending it from January 1, 2018 to July 1, 2019. Due to this amendment, Financial Institutions and Advisers will only have to comply with the Impartial Conduct Standards Read More…

Regulation D, established by the Securities and Exchange Commission, provides exemptions that allows companies to raise capital through the sale of unregistered securities. Under Regulation D, companies can avoid the costs associated with a public offering. Although companies are not required to register with the SEC under Regulation D, they are still required to provide[…]

The Securities and Exchange Commission (“SEC”) recently announced an upcoming change to the definition of “qualified client” as defined in Rule 205-3 under the Investment Advisers Act of 1940 (“Advisers Act”) that will become effective August 15, 2016. This applies to any Registered Investment Adviser (“RIA” or “Investment Adviser”) that earns performance based fees.

To provide some background, Section 205(a)(1) of the Advisers Act generally prohibits an investment adviser from entering into, extending, renewing, or performing any investment advisory contract that provides for performance Read More…

Earlier this year, FINRA began accepting applications for firms wishing to register as Capital Acquisition Brokers. A Capital Acquisition Broker (“CAB”) is a firm that engages in a limited range of activities. Such activities include advising companies and private equity funds on capital raising and corporate restructuring, and acting as placement agents for sales of unregistered securities to institutional investors under limited conditions. CABs cannot carry or maintain customer accounts, handle customers’ funds or securities, accept Read More…

FINRA has announced new rules relating to the financial exploitation of seniors and other specified adults. On February 5, 2018, the amendments to Rule 4512 and new Rule 2165 become effective. FINRA Rule 4512 FINRA Rule 4512 will require members to make reasonable efforts to collect the name and contact information of a trusted contact[…]

In the securities industry, there are many key players. I’m sure you’ve heard the terms: broker, dealer, and broker-dealer. Although many may assume that the terms have the same meaning, there are in fact not the same. All three play a major role in the activity of the stock market. However, there are several key[…]

As technology continues to advance, the Financial Industry Regulatory Authority “FINRA”) must address how certain regulations will be interpreted as it relates to social media platforms. FINRA Rule 4530 requires firms to promptly report to FINRA, no later than 30 calendar days, after it knows or should have known that the firm or an associated person of the firm is the subject of any written customer complaint involving allegations of theft or misappropriation of funds, securities, or of forgery. Under the rule, a customer is defined as any person, other than a Read More…